Saving for your retirement – the importance of acting now
- You may not be as fit and able to maintain your property as you once were, requiring the hiring of people to cover various jobs from decorating to cleaning.
- You may need to cover nursing or residential care – things you do not entertain when you land your first job.
- Your family need help stepping onto the housing ladder and turn to you for support.
- You may suddenly find your birthday and Christmas present list growing as your family grows.
- Utilities seem to cost more every year and being at home all day does nothing to reduce those heating bills.
It is important to start planning for retirement early, to ensure you remain financially secure once your working life is complete. If you wish to continue to enjoy a good standard of living so leaving it until a few years before retirement may not give you enough time to accumulate the funds necessary for your retirement years.
It is never too early to start saving for your retirement!
Let’s talk pensions
A pension is the most common way of saving for retirement. It involves making regular payments into a pension scheme to create a pension fund which is then invested.
The vast majority of people saving into a pension scheme do so through their employer’s pension scheme. With auto enrolment, your employer has a legal obligation to provide qualifying employees with a suitable pension provision and manage the process according to requirements of The Pensions Regulator.
- Each month you, your employer and HMRC contribute to the fund
- The fund is invested in the hope that it will grow in value
- This accumulated fund is then used to provide income in retirement
- You and your employer currently enjoy tax relief on contributions. If you do not qualify for a pension under auto enrolment for whatever reason, there is still the option to take out a personal pension. NISA’s and other investment products with enhanced tax benefits can also be facilitated for pensions
There are many other ways of saving for retirement:-
- NISA’s (New Individual Savings Accounts)
- Onshore and Offshore investments
- Using all tax incentives available
To learn more about saving for your retirement contact us today.